Passions around devaluation or what Belarus is similar to Greece

The Economic Observer "Deutsche Welle" Andrew Gurkov compares crises in Belarus and Greece, and explains why the Belarusians should not go to the Russian ruble.

Belarusians vain dream of moving to the Russian ruble: the currency of the country will provide the raw material and are the "Dutch disease." With more hard currency of their economy, like the Greek, will become less competitive.

Crises are very much favorable scenario activity. In the sense that any economic cataclysm usually generates a lot of scenarios to overcome it. At the same time the most simple and seemingly obvious recipes are, as a rule, the most elusive and even dangerous. At the moment, fall into this category as Belarus proposal to move to the Russian ruble and a rather popular idea in Greece to abandon the euro and return to the drachma.

For some — the trouble is, for others — a hope

Generally in Belarus and Greece are not so much in common, except for the fact that both countries are currently experiencing an existential crisis caused by chronic nekankurentazdolnastsyu national economies. However, both countries have in common and that is now more crucial that acquired them subject to devaluation. The only difference is that for Belarusians depreciation of the national currency — this is a real problem, and for the Greeks — an unattainable dream.

After all nostalgic dreaming about the good old drachmas are nothing but tight on the time, when the low competitiveness of the Greek economy is easy enough to offset by the devaluation of the national currency. Any reduction in its rate is automatically increased the attractiveness of the Greek resorts in the eyes of foreign tourists and strengthened the position of the Greek agricultural products in the international agricultural market. And therefore Athens, and, say, Rome or Lisbon often turned to this mechanism.

But then Greece, Italy and Portugal, together with other EU countries have adopted the euro, which is determined by the high hardness, for which he, in fact, a lot, and love. In hard currency really has lots of advantages, that's just make it a "softer" very difficult. This means that now have to raise competitiveness through a long and slow streamline, automate, optimize production and management processes than are so fond of watching tedious Germans, Dutch and other Finns, but that does not appeal to many hot people of the South.

Russian ruble as a source of "Dutch disease"

So, as the saying goes, "his example — other science." Belarusians who dream of going on a relatively solid Russian ruble should take a closer look at the sad experience of the Greeks. For a small country, which has no significant stocks of raw materials, and therefore forced to make due to the export of goods and services, it is better to have a softer currency. In any case, at this stage, as long as a country has not learned to produce in demand in globally high-quality and innovative industrial products.

Belarus that stage yet clearly not reached. And because the Russian ruble would become for her a brake on the inevitable modernization. In Russia — raw materials economy, and this — a very different model than the one that fits the smaller states of Central and Eastern Europe. Russian energy exports provides a powerful flow of hard currency, which inevitably leads to a real appreciation of the ruble. This encourages the import of finished products and reduces the chances of Russia's manufacturing industry to break with the goods on the world market. She survives at the expense of state subsidies and the huge domestic market, where many consumers are willing to settle for third-rate quality of domestic products at a relatively low cost her, saying, "Lada" — this is not a dream of the motorist, but it is much more affordable for imported "Volkswagen".

Russia largely suffers from the same "Dutch disease" which caused damage even very advanced industrialized the Netherlands during the second half of the twentieth century, after the oil and gas boom that started there. If Belarus goes to the Russian ruble, its producers and landowners necessarily become infected with the virus.

Soft currency as bait for foreign investors

Instead illusory hypothetical transition to the Russian ruble in front of her now opened a totally different way: take advantage of the opportunity, which gives a strong devaluation, and quickly roll out their industry. The Greeks, for whom leaving the euro would be suicide for this version can only dream of, and powerful China, for example, by hook or by crook, for the sake of trying to boost exports to keep the yuan at a low level. However, China and even Greece has much to offer to the international market, including travel services.

The problem in Belarus is that it produces too few goods that are in demand in neighboring Russia, especially abroad. But this, too — work that can be done. At a time when China and in many other countries of the former, much more expensive labor force, a state with a devalued currency at the border of the European Union could, in the short period of time to attract a large number of foreign investors. They are happy to be here unfurled a modern production and willingly would provide Belarusians work for the production of their exports.

But for that we need reform. Not so much a radical as decisive, unambiguous and consistent. Unfortunately, this path is also illusory hypothetical.

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